When Demand Increases Cause Shakeouts
研究了需求增加如何通过固定投资形式的非价格竞争导致企业数量减少，以1960-1980年代酒店业游泳池投资为例，发现高速公路开通带来的需求增加在温暖地区减少了企业数量。
Standard models that guide competition policy imply that demand increases should lead to more, not fewer firms. However, Sutton’s (1991) model shows that demand increases instead can lead to shakeouts if non-price competition takes the form of fixed investments. We investigate this effect in the 1960s–1980s hotel and motel industry, where quality competition arose through investments in swimming pools. We show that demand increases associated with highway openings led to fewer firms, particularly in warm places. We do not find this effect in other industries that serve travelers, gasoline retailing, and restaurants, where quality competition does not involve fixed investments.